November 4, 2016
Global demand for cashews has spiked 53% since 2010 and exceeded production rates for four of the past seven years, making its sales the fastest-growing in the tree-nut category,Â according to Bloomberg.An unprecedented drought in Vietnam, the world's top cashew importer, threatens to further reduce supplies and skyrocket prices. The current market is valued at $52 billion.Â Exports have jumped 70% in a decade, and 25% of all cashew shipments come to the U.S. The nuts are used to make products like cashew milk and protein bars, or sold as snacks.
Cashew popularity has outpaced both pistachios and almonds in recent years, securing its place as nut of the moment in the $30 billion tree-nut market. The U.S. is the second largest importer of the nut after India, and the Vietnam Cashew Association predicts that 34% of the 300,000 tons of processed cashews exported in 2016 will come to the U.S.Consumer interest in dairy-alternative products has fueled much of the nut's popularity.Â Though almonds are generally perceived as the gold standard for nut-based milks and cheeses, major manufacturers have begun incorporating cashews into their products because of perceived agricultural benefits. While almonds are grown primarily in California and are increasing the state's water strain,Â cashews can be imported from Vietnam without leaching U.S. resources.It remains to be seen how brands like JIF and Silk, which use the nut for cashew butter and cashew milk, respectively, respond to the impending nut shortage. Higher prices may turn consumers back to soy and almond alternative dairy products, but its unlikely that it will reduce overall interest in the dairy alternative sector, which is estimated to grow to $21.7 billion by 2022.Cashews can also be imported from other regions, including Brazil, India and several African countries, which may soften the blow to the market.